Survival in 2001 and Beyond

How are you going to compete in a global economy?

This was a review of a presentation for Vertical Mills to inform them on the current state of the industry.

The Impact of a Changing World!

Textiles

Take a ride down US 321 through Gaston County on into South Carolina and count the empty building!

Fiber Optics

First layoffs in the history of some Catawba County producers!

Other economic indicators illustrate that the playing field has changed

All businesses have been effected.

Issues with US Hosiery Industry
- Reduced customer base.
- Pricing pressure from retail.
- False feeling of security with competition going out of business.
- Import pressure.
- Cash flow problems
- Poor processes – quality, service, communication
Overall Observations from the HTC attending the Magic Apparel Show on August 2001

Asian and Middle Eastern presence highly visible.
Turkish Hosiery contingent were very well organized through their trade association that is government sponsored.
Very little visible US presence at Magic Show.
Foreign countries are “Hungry” for US market and will do whatever it takes to get here.

Eighteen Turkish Booths at Magic Show Selling Hosiery
Some of whom you may be doing business with.
With All Hosiery Types -- The Price was ½ the wholesale price of our comparable goods

Does this mean that the Solution is to Import From Turkey?

RIGHT?

Not so fast!

Importing Issues to Consider:
- Instability of governments in foreign countries
- Payment for goods due at time of shipment (Quality issues found when container is opened here!)
- Higher inventory levels due to longer lead times
- Minimum order quantities may be higher than domestic suppliers
- Lower shipping costs demand large order quantities (as much as 40,000 dozen per container)
- What could the long term effect of importing goods mean?
Are you teaching your offshore supplier how to do business with your retailer?
This has happened in other industries! (furniture)